U.S. Senate crypto bill draft revealed, DeFi regulation for the first time incorporated into the protection framework

A draft of an unfinished cryptocurrency market structure bill has recently circulated within the industry. The content indicates that decentralized finance (DeFi) will receive a certain level of legal protection, but key issues such as stablecoin rewards and yields remain unclear. The draft obtained by CoinDesk shows that the document is a discussion draft for a forthcoming hearing by the Senate Banking Committee, spanning 272 pages.

The Senate Banking Committee plans to review the bill’s provisions on Thursday and accept amendments proposed by senators, with all amendments due by Tuesday evening. The draft explicitly outlines the regulatory framework for the U.S. Securities and Exchange Commission (SEC) concerning securities, illegal financial activities, DeFi, banking operations, and “responsible regulatory innovation,” but whether stablecoins are linked to yields or rewards remains marked as “TBD.” Additionally, the draft does not include the ethical concerns related to Donald Trump and his family’s connections to crypto companies, which Democratic lawmakers proposed last year.

Notably, the draft introduces the concept of “auxiliary assets” for the first time and establishes a chapter discussing DeFi regulation. While the protections are not as comprehensive as those proposed in the “Blockchain Regulatory Certainty Act” by Cynthia Lummis and Ron Wyden, industry insiders believe that some protections for the DeFi sector remain intact and have not been entirely removed. Senators Jack Reed, Tina Smith, and Chris Van Hollen have written to Committee Chair Tim Scott, requesting a hearing before Thursday’s review to ensure sufficient time for analysis of the provisions and preparation of amendments, avoiding rushed voting.

The final version of the bill has not yet been released. There are differences between the Senate and House versions, especially regarding the “auxiliary assets” clause, which requires coordination between the two chambers. Industry analysts believe that this draft will become a key reference for U.S. cryptocurrency regulation in 2026, with far-reaching implications for DeFi development and investor rights protection. The progress of the draft and the outcomes of the hearings will directly influence future compliance frameworks for the crypto market and the regulation of stablecoins.